Penn National to oppose gambling expansion referendum

Penn National Gaming will put its considerable resources behind a campaign to defeat gambling expansion, and is starting the effort Thursday with an "open letter" to Marylanders explaining their position.

"We love it here and we're proud of our role and the facilities we own and operate here," says the letter that will be published in The Baltimore Sun Thursday. "We hope that it is never forgotten in the heat of a campaign when we'll be pointing out ways Maryland government can do it better than the way it has chosen."

Penn goes on to outline its strategy: The company will argue that Maryland would "generate more casino tax revenue" if the law stays the same. The new referendum would bring in an additional $100 million in tax revenues and about $525 million for casino owners, according to the Department of Legislative Services.

The announcement sets up a mammoth-sized casino war in Maryland. MGM Resorts International, which supports gambling expansion here, has already spent $2.3 million on ads touting benefits of adding a casino via a ballot committee called For Maryland Jobs and Schools. A Penn spokeswoman said her company will support a different ballot committee recently formed called "Get the facts - Vote no on 7."

The company is a formidable opponent. In Ohio, it poured tens of millions into ballot campaigns to defeat gambling expansion in order to protect a nearby casino.

Maryland is set to have an unusually crowded ballot in November -- with one question on whether the state should add a sixth casino (to be built in Prince George's County) and allow table games at all the state's gambling locations.

Supporters say the changes to the state's program will bring in more tax revenue, create jobs and make the Maryland's gambling program more competitive with casinos in surrounding states.

Opponents say the extra casino would saturate the state with gambling locations and increase the risk of gambling addiction in the state.

Penn has the added gripe that it's been treated unfairly. The company would like the chance to build a casino in Prince George's County at a horse track it owns. However, Prince George's County Executive Rushern L. Baker III has put his support behind a different proposal by MGM Resorts to be built at nearby National Harbor.

Penn also believes its current Maryland casino - Hollywood Casino Perryville - was treated badly by the General Assembly. It is the only location without a guaranteed cut to the state's 67 percent tax rate.

The company also operates a highly profitable casino at Charles Town in West Virginia and it has said business there would be adversely impacted by enhanced competition from a National Harbor casino. The company attempts to dispel the argument, writing in their letter that they have offered to pour $500 million into a new casino at Rosecroft (that would presumably also cannibalize the Charles Town business).

The letter is signed by Tim Wilmott, president and chief operating officer of Penn National and the managers of Penn's two properties in Maryland; Bill Hayles, who runs Hollywood Casino Perryville; and Lisa Watts, who is in charge of Rosecroft Raceway.